Setting Up Your Tax ID

Setting the Table

There's a saying that you have to set the table before you sit down to eat. Well before we start publishing and profiting from our efforts, we have to make sure that we're setting ourselves up for success. And for me, I knew that I was going to have to separate any earnings that (hopefully) would be coming from book sales. Setting up a Tax ID was the first step in the process.

I know what you're thinking - this is a course on how to self-publish my book, right? Yes - but we need to think like small business owners right now. Setting the table in this area will allow for time to really focus on what matters to us - writing!

A Tax ID is an identifying number used for tax purposes in the United States. It is also known as a Tax Identification Number or Federal Taxpayer Identification Number. A TIN may be assigned by the Social Security Administration or by the Internal Revenue Service (IRS).

Essentially, a Tax ID is like the Social Security Number for your business. I didn't want to mix earnings from books with earnings from my "day job." So I made sure that any time I had to fill out a W9 form from a school or organization that wanted to pay me for author services (speaking, book sales, etc.), I made sure that these earnings were assigned to my Tax ID.

Here's how to obtain your Tax ID:

I chose to select the Sole Proprietor/Individual option, as outside of creating a Limited Liability Corporation (LLC), none of the other options applied to me.



The form will take about five minutes to fill out and it's fairly straightforward. But you're going to want to spend some time thinking about your DBA (Doing Business As) name. For example, you're a sole proprietor (a single author) and your publishing company will be called Awesome Words. Even though the IRS doesn't make this field mandatory - for our purposes it really needs to be.

Why is this important?

  1. Because any future projects (books) you write and release will belong to this company.
  2. When we start talking about distribution/book creation, having a Business name is essential
  3. Having a publishing company name behind the project lends a certain level of clout to the customer (buyers at retail outlets, librarians and schools).

So you're going to want to think of a good name, something meaningful to use because this will be the name of your publishing company. Make sure that the publishing company name resonates with readers and the organizations that make purchasing decisions.

Lastly, you want to make sure that your publishing company name reflects the "soul" or "essence" of the type of books you want to share with the world. A good question to have in mind: Would I want to submit a manuscript to this company?

Submit

Make sure that your email address is reliable because you will be sent your new Tax ID via e-mail. The process is relatively quick and painless.

So STOP here and do not move forward until you complete this step!

:)

Complete and Continue